Publication: Monitor Volume: 5 Issue: 4

Yesterday, Prime Minister Yevgeny Primakov stressed the need to impose order and discipline within the government. The theme has been a popular one among top-level government officials–regardless of their ideological complexion–over the last seven years. The prime minister, in a speech to a session of the government’s commission for restoring a state monopoly on the production and sale of alcohol, said that imposing order in the country must begin with strict discipline at the top, with government and executive power. Primakov was in something of a scolding mode, noting that three months had passed since October 6, when President Yeltsin signed a decree mandating a state alcohol monopoly. “Presidential decrees and government orders must be carried out completely and on time,” Primakov said. With that October decree in mind, he pointed out that the unabated illegal alcohol production not only robs Russia’s budget of revenues, but poisons its citizens. Not only is illegal alcohol manufacture continuing unchecked, but the illegal import of ethyl alcohol–the main ingredient for illegal alcoholic beverages–also continues, though the levels have been cut (Russian agencies, January 6). Interior Ministry experts say that illegal alcohol is produced both by underground and licensed factories. On January 5, Primakov signed an order halting the distribution of licenses for importing ethyl alcohol until the government determines who is eligible for them (Russian agencies, January 5).

The economics ministry has estimated the losses to the budget from the illegal production and sale of alcohol–that is, uncollected taxes–at 30 billion rubles a year (around US$1.5 billion). The average number of people killed each year by poisoned alcohol exceeds 30,000. At the end of 1997, Russia’s Interior Ministry reported that more than 40,000 people had died of alcohol poisoning that year alone. One television channel reported yesterday that in the final week of last December, the authorities closed down 220 underground liquor factories and seized 300,000 deciliters of fake vodka, 7,000 of which were poisonous (RTR, January 6). In 1990, according to one estimate, the Soviet state’s alcohol monopoly provided it with 18 percent of its total revenues. By 1997, the Russian state was receiving only 3 percent of total revenues from alcohol.

Yeltsin’s decree from last October was not the first time he ordered the government to restore the state alcohol monopoly. He did the same thing in December 1996. At that time, Anatoly Chubais, then Kremlin chief of staff, said Yeltsin’s move was “not just a slogan but a political task which envisages tough state control at all stages, from production to wholesale and retail distribution.” Chubais, like Primakov today, was emphasizing the need for executive discipline, calling for a “presidential vertical of power” and even a “dictatorship within the government.” In 1997, Yeltsin, at the instigation of then Deputy Prime Minister Boris Nemtsov, signed a decree banning the sale of vodka in kiosks. According to many observers, the vodka sales simply went on under the counter. The record of the last several years, thus, would suggest that the Yeltsin-Primakov push for a liquor monopoly will achieve little more than did the earlier attempts.